MLive
Oct. 24, 2024
Brian McVicar
As former President Donald Trump and JD Vance crisscrossed Michigan this fall, one of their biggest talking points has been electric vehicles.
Or, more precisely, what they call an “EV mandate” from the Biden administration.
They say a federal rule that seeks to bolster EV production will decimate the domestic auto industry and kill jobs. Democrats, meanwhile, argue there is no EV mandate. Rather, they say the Biden administration has made big investments so the U.S., and not China (the world’s biggest producer of EVs), is the place where the next generation of vehicles is made.
The presidential campaigns for Kamala Harris and Trump have held numerous rallies in Michigan, seeking a Nov. 5 victory in the battleground state where making cars is a key part of the economy. At nearly every stop, it’s not long before you hear about the auto industry’s shift to electrification.
So, what’s true?
Is there an EV mandate? And if the auto industry ramps up EV production, does that mean fewer jobs here in Michigan?
Here’s a look at what researchers and auto industry groups have to say about the issue:
Is There an EV Mandate?
No, not per se.
The EV mandate is a reference to a U.S. Environmental Protection Agency rule, which was finalized in March and sets stricter standards on tailpipe emissions for passenger vehicles. The rule, which takes effect in 2027, offers automakers several pathways to meet the stricter standards.
One way would be for all electric vehicles to account for 56% of vehicle sales by 2032, with plug-in hybrids accounting for an additional 13% of sales, the EPA said.
That’s up significantly from current EV sales numbers, which accounted for 7.6% of new vehicle sales last year.
The rules don’t apply to used cars, and there is no mandate that customers purchase EVs.
Emissions from cars and other forms of transportation are the largest source of greenhouse gas emissions, which the EPA calls the “most significant driver” of climate change. The EV rule is part of the Biden administrations effort to cut greenhouse gas emissions.
In addition to the EV production goals, the Biden administration has invested billions through the Inflation Reduction Act to boost battery production and help automakers retool assembly lines for an EV transition.
Trump, if elected, has vowed to “end the electric vehicle mandate on day one.” Harris has said she will “never tell you what kind of car you have to drive.” Her platform supports the Biden administration’s EV investments, and says she will build on the administration’s push to bolster the sector.
Are Automakers on Board With the EV Rule?
Initially, there were big concerns.
When the EPA first proposed the new emission standards in 2023, the EV requirement was more ambitious. At that time, it would have required automakers to sell 60% EVs by 2030 and 68% by 2032, Reuters reported.
The Alliance for Automotive Innovation, which represents automakers and lobbies on their behalf, said the proposal was “neither reasonable nor achievable in the timeframe provided” and amounted to a “de facto battery electric vehicle mandate.”
The UAW was also opposed, asking the EPA to soften the rule to “better reflect the feasibility of compliance,” Reuters reported.
Following the Feedback, the EPA Scaled Back the EV Rule
The final rule, announced in March, maintains its ambitious targets but gives automakers more time to meet them. The head of the Alliance for Automotive Innovation said making the change was “the right call.”
“Moderating the pace of EV adoption in 2027, 2028, 2029 and 2030 was the right call because it prioritizes more reasonable electrification targets in the next few (very critical) years of the EV transition,” said John Bozzella, the group’s president and chief executive officer. “These adjusted EV targets – still a stretch goal – should give the market and supply chains a chance to catch up.”
He also noted that “the future is electric,” and “automakers are committed to the EV transition.”
Will Ramping up EV Production Cost the Auto Industry Lots of Jobs?
Early estimates indicated it might.
Some of those initial claims, dating back to 2017, indicated there could be a 30% to 40% reduction in labor resulting from the transition.
But new research from the University of Michigan says there’s a smaller risk for the rapid, widespread job losses that many feared.
EVs require fewer parts than traditional gas-powered vehicles. For example, mufflers, spark plugs, a complex transmission system and more are not needed in the vehicles. Because of that, the assumption has been that assembly jobs would be lost in the transition.
However, UM researchers reached a different conclusion.
In a study published in September in the journal Nature Communications, they looked at job levels over time at three assembly plants that transitioned from gas-powered vehicles to EVs.
They found assembly jobs increased as much as tenfold at assembly plants in the ramp-up stages transitioning to EV production. At another plant, where EVs had been made for over a decade, total employment remained three times higher.
“There is a shortage of information out there about how the transition is shaping up,” said Anna Stefanopoulou, the William Clay Ford Professor of Technology and senior author of the study. “What we’re seeing, with the data that’s available, is that the loss of employment predicted for EVs is not happening.”
The three factories examined in the study are: a Tesla plant in California previously owned by General Motors and Toyota; a Rivian factory in Illinois previously operated by Mitsubishi, and a General Motors plant in Oakland County, Michigan.
However, There are Caveats
While the study focused on automotive assembly jobs, its authors said further examination is needed to see how the EV transition will affect automotive parts jobs. Those jobs comprised 66% of all auto manufacturing jobs in the U.S. in 2022, according to the study.
Worker demand is expected to remain high for parts such as steering, brakes, seats, electrical, suspension and interior trim, the study says. However, job losses are expected in areas such as transmission and engine-related parts.
Whether displaced workers could transition to other EV-related jobs, such as battery cell manufacturing, is an open question, the study says.
“Our work shows clearly that the number of assembly workers in the plants has increased in many cases,” said Andrew Weng, a University of Michigan research fellow in mechanical engineering and co-first author of the study. “However, the jury is still out in terms of parts manufacturing jobs, which will largely depend on where battery cell manufacturing takes place.”
Michigan has invested big in battery manufacturing, seeking to lure projects by General Motors, Gotion Inc., LG Energy Solution, Our Next Energy and Ford Motor Co. Bridge Magazine reported in June that the state had spent about $1 billion on incentives for those projects, but that only 200 or so jobs have been created thus far.
Some of the projects, such as Ford’s, have been delayed or scaled back amid uncertainty over EV demand.